From our analysis, PenFed Credit Union is the top vehicle loan lender due to its large range of loan types and low rates. Our other pick, OpenRoad Lending, provides used car rates as low as 1.99%. We evaluated 21 car loan companies’ APRs, loan types, loan periods, vehicle and borrower requirements, and other characteristics to find the best new, used, and refinance auto loan rates. We polled 1,016 auto loan borrowers regarding lenders and the loan procedure.
Low-Rate Auto Loans for April 2024
- Top Overall in the USA: PenFed
- Top for Bad Credit/Low Rates in the USA: AUTOPAY
- Top Credit Union in the USA : Consumers Credit Union
- Top for Refinance in the USA : LendingTree
- Top for Fair Credit in the USA : LendingClub
- Top for Full Car Buying Experience in the USA : Carvana
- Top for High Maximum Accepted Mileage in the USA : OpenRoad Lending
Highlight Point of Low-Rate Auto Loans
| Category | Information |
| Top Overall in the USA | PenFed |
| Used APR Range: 6.49%–17.99% | |
| Used Loan Amounts: $500–$150,000 | |
| Minimum Recommended Credit Score: Not disclosed | |
| Top for Bad Credit/Low Rates | AUTOPAY |
| Used APR Range: As low as 5.69% | |
| Used Loan Amounts: $2,500–$100,000 | |
| Minimum Recommended Credit Score: 500 | |
| Top Credit Union in the USA | Consumers Credit Union |
| Used APR Range: As low as 6.84% | |
| Used Loan Amounts: $500–$350,000 | |
| Minimum Recommended Credit Score: Not disclosed | |
| Top for Refinance in the USA | LendingTree |
| Refinance APR Range: As low as 5.99% | |
| Refinance Loan Amounts: Not disclosed | |
| Minimum Recommended Credit Score: Not disclosed | |
| Top for Fair Credit in the USA | LendingClub |
| Refinance APR Range: 4.99%–24.99% | |
| Refinance Loan Amounts: $4,000–$55,000 | |
| Minimum Recommended Credit Score: 600 | |
| Top for Full Car Buying Exp. | Carvana |
| APR Range: Not disclosed | |
| Loan Amounts: Not disclosed | |
| Minimum Credit Score: 500 | |
| Top for High Max. Accepted Mileage | OpenRoad Lending |
| Refinance APR Range: 1.99%–24.99% | |
| Refinance Loan Amounts: $7,500–$100,000 | |
| Minimum Recommended Credit Score: 500 |
1. PenFed- Top Overall in the USA
- Used APR Range: 6.49%–17.99%
- Used Loan Amounts: $500–$150,000
- Minimum Recommended Credit Score: Not disclosed
Pros
- Provides a wide range of auto loan options;
- Permits the purchase of vehicles from third parties;
- Offers promotions for using car-buying services
Cons
- Credit union membership required
- prohibits co-signers
- There are no available rate breaks.
Why We Selected
We think PenFed is the best place to get auto financing because it has all the loan types you could want at reasonable rates. You can get loans for new or used cars, refinances, cash-out refinances, and even lease buyout loans. If you want to, you can even use a used car loan to buy a car from a private seller.
If you get one of PenFed’s loans, the company will send you a check.
That might take a few days, but PenFed has a good relationship deal if you’re okay with using the TrueCar service to buy a car. If you use this service, you might get your loan the same day you get accepted.
PenFed’s customer help can be reached by phone or a safe online message. The main office of PenFed is in McLean, Virginia, and the company has been around since 1935.
Check out our full review of PenFed car loans.
Terms and Borrower Qualifications
- Used loan terms: 3–7 years
- Available in all 50 states and Washington, D.C.
- Must join the credit union by depositing at least $5 in a savings account.
Vehicle Qualifications
- For loans with terms shorter than seven years: The car can be any age, but it must
- have less than 125,000 miles on it.
- For loans with terms of seven years or more: The car must be less than five years old and have less than 60,000 miles on it.
- Maximum amount of loan to value: 125%
- Allows private parties to buy cars: Yes
2. AUTOPAY
- Used APR Range: As low as 5.69%
- Used Loan Amounts: $2,500–$100,000
- Minimum Recommended Credit Score: 500
Pros
- Rates that are pretty low
- No money for 45 days
- Low credit score needed to qualify
Cons
- Very limited loan information
- fails to reveal partner lenders
- only eligible with a co-borrower; not with a co-signer.
Why We Selected
The loan aggregator AUTOPAY is a little vague on the specifics—possibly on purpose to entice you to bite. With some of the best auto loan rates available right now when compared to other lenders and aggregators, AUTOPAY has the potential to be one of your most affordable financing solutions if your borrower criteria are exceptional.
It’s our best option for those with weak credit because it accepts applications from borrowers with credit scores as low as 500. However, you should exercise caution because it doesn’t indicate the maximum rate range that someone with bad credit would likely pay. This is especially true since you can’t apply with a co-signer—only a co-borrower. However, you can benefit from some extremely competitive interest rates if your credit is good.
Used automobiles, new cars, refinances, cash-out refinances, and even lease buyout loans are all available with AUTOPAY. It can provide such a high degree of flexibility because it does not provide the loans directly; instead, it works with a network of partner lenders. Because of this, it’s a wise addition to your shopping list, though we wish it provided more specific information.
AUTOPAY is a Denver, Colorado-based company that was established in 2007. The company’s contact information is available by phone or online. View our whole AUTOPAY car loan review to learn more.
Terms and Borrower Qualifications
- Used loan terms: 2–8 years
- Recommended credit score of 500 or higher
- Available in all U.S. states and Washington, D.C.
Vehicle Qualifications
- Maximum accepted vehicle age: 10 years
- Maximum accepted mileage: 150,000 miles
- Maximum loan-to-value ratio: Not disclosed
- Allows private-party vehicle purchases: Yes
3. Consumers Credit Union
- Used APR Range: As low as 6.84%
- Used Loan Amounts: $500–$350,000
- Minimum Recommended Credit Score: Not disclosed
Pros
- permits co-signers
- No limitations on mileage or age
- provides a wide range of vehicle financing choices.
Cons
- Exclusively usable at a dealership
- To get a loan, you have to join a credit union.
- Transparency on the conditions of loans.
Why We Selected
For those who favor banking with these financial organizations, Consumers Credit Union is a solid option as they have the top rating among credit unions. It’s also one of the few lenders that doesn’t place restrictions on the model year or mileage of your automobile, which makes it an excellent option if you’re looking to buy an older car from a dealership.
Additionally, Consumers provides an optional mechanical repair insurance plan via ForeverCar; this may be crucial if you drive an older vehicle.
Although Consumers doesn’t specify what kind of credit history is required to qualify for a loan—or any other qualifications, for that matter—if you have bad credit, it could be a good idea to add this one to your list of things to consider. For example, the maximum rate you pay on a refinance loan is around half of what some other lenders could charge. Additionally, the minimum borrowing amount is quite modest.
You can contact customer service by phone, email, or live chat on the internet.
Chartered in 1930, Consumers Credit Union is headquartered in Round Lake Beach, Illinois.
Terms and Borrower Qualifications
- Used loan terms: 36–84 months
- accessible to residents of Washington, D.C. and all 50 states.
- If your loan application is approved, you must pay the $5 membership fee to join the Consumers Cooperative Association and deposit $5 into a savings account to become a member.
Vehicle Qualifications
- Maximum accepted vehicle age: None
- Maximum accepted mileage: None
- Maximum loan-to-value ratio: 125%
- Allows private-party vehicle purchases: No
4. LendingTree
- Refinance APR Range: As low as 5.99%
- Refinance Loan Amounts: Not disclosed
- Minimum Recommended Credit Score: Not disclosed
Pros
- Possibility of extremely low rates
Quickly compare numerous refinance loan offers
No restrictions on the vehicle’s age or mileage
Cons
- able to produce a lot of spam
- very low ratios of loan to value
- provides few facts regarding their loans
Why We Selected
Another business that can assist you in finding the best loan rates from its network of lenders is LendingTree. But it has the same issues as other lender networks: it doesn’t tell you whose lenders it is using to check your rates with or what kinds of loans you might be eligible for. It’s also reasonable to anticipate receiving a lot of spam from businesses.
Still, with its fairly low rates, it’s a wonderful choice if you’re wanting to refinance your auto loan. All you have to do is make sure your car has a lot of equity because LendingTree lenders won’t approve loans with a loan-to-value ratio higher than 80%. In other words, debts that are underwater cannot be refinanced.
You can give LendingTree a call, but you should probably get in touch with the partner lender if you obtained a loan through LendingTree.
Founded in 1996, LendingTree is presently headquartered in Charlotte, North Carolina.
Terms and Borrower Qualifications
- Refinance loan terms: 36–72 months
- Available to residents of all 50 states and Washington, D.C.
Vehicle Qualifications
- Maximum accepted vehicle age: None
- Maximum accepted mileage: None
- Maximum loan-to-value ratio: 80%
- Allows private-party vehicle purchases: Not disclosed
5. LendingClub
- Refinance APR Range: 4.99%–24.99%
- Refinance Loan Amounts: $4,000–$55,000
- Minimum Recommended Credit Score: 600
Pros
- A minimum of 600 is the suggested credit score.
- No interest charges
- able to restructure with the same lender
- Cheap rates for borrowers that meet the requirements
Cons
- prohibits co-signers
- several limitations on residency and vehicles
- does not provide used or new auto loans.
Why We Selected
The once peer-to-peer lender LendingClub has moved into the auto refinance market, where it provides consumers with excellent credit with extremely competitive rates. Due to its excellent overall score and ability to approve borrowers with fair credit, LendingTree is our top choice in this area. However, if your credit is very poor, you may be charged a higher rate than most other lenders. Positively, there are no fees associated with using LendingClub—none whatsoever, including origination, late, or prepayment penalties.
If you chance to qualify, LendingClub is one of the few lenders that lets you refinance your existing loan with another LendingClub loan. But be advised that this lender has a lot of lending restrictions. For instance, it isn’t available in many areas with low population densities, and LendingClub won’t finance a wide range of popular car types and models.
Founded in 2007, LendingClub has its main office in San Francisco, California.
To learn more about your possibilities, view more of the top car loans for fair credit.
Terms and Borrower Qualifications
- Refinance loan terms: 2–7 years
- Requires a credit score of at least 600; • Must have been open for a minimum of one month;
- Must have at least 24 months left on current vehicle loan
- Open to citizens of every state in the union, with the following exceptions: Alaska, the District of Columbia, Hawaii, Maine, New Hampshire, North Dakota, Vermont, West Virginia, and Wyoming.
- You must be a citizen or permanent resident of the United States, or hold a valid long-term visa, and be at least eighteen years old.
Vehicle Qualifications
- Maximum accepted vehicle age: 10 years
- Maximum accepted mileage: 120,000 miles
- Maximum loan-to-value ratio: Not disclosed
- Allows private-party vehicle purchases: No
In addition:
- The remaining amount owed on the loan must be between $5,000 and $55,000.
- Unable to refinance business automobiles
- The state where you live must be where the vehicle is registered.
- Numerous vehicles, including Nissan Leafs and Suzuki, Saturn, Mercury, Saab,
- Pontiac, Oldsmobile, Hummer, and more types, are not eligible for financing.
6. Carvana
- APR Range: Not disclosed
- Loan Amounts: Not disclosed
- Minimum Credit Score: 500
Pros
- Smart, technological method of purchasing a vehicle
- offers a return policy of seven days.
- extended 45-day window for preapproval
Cons
- Available only within the contiguous United States.
only permits co-signers; co-borrowers are not allowed
No reimbursement is given for delivery fees if the car is returned.
Why We Selected
Our top-rated provider of this service is Carvana, a used car dealership that provides a fully online car-buying experience akin to TrueCar.
You can search for a car online, apply for an auto loan, and then pick it up or even have it delivered.
However, Carvana is well-known for its automobile vending machines. One of its enormous vending machines allows you to make an appointment to test drive a car if you’ve been pre-approved for a loan. You will even receive a token to use from the company.
You are free to keep the car if you like it. You will have seven days to return it if not.
Many people find it to be a futuristic method of purchasing a car, however there may be setup issues. For example, you can return an automobile that has been delivered if you decide you don’t like it, but the delivery cost is not refundable. This makes taking a test drive of many models, as you would at a dealership, both expensive and impractical.
The Carvana customer service team can be reached via text message or live chat on the company’s website. The business is headquartered in Tempe, Arizona, and was started in 2012.
Terms and Borrower Qualifications
- Loan terms: Not disclosed
- Minimum recommended credit score of 500
- Must be at least 18 years old
- Minimum annual income of $4,000
- Must not have any active bankruptcies
- Available to residents in contiguous U.S.
Vehicle Qualifications
- Maximum accepted vehicle age: Varies
- Maximum accepted mileage: 140,000 miles
- Maximum loan-to-value ratio: Not disclosed
- Allows private-party vehicle purchases: No (only for used cars bought through the Carvana platform)
7. OpenRoad Lending
- Refinance APR Range: 1.99%–24.99%
- Refinance Loan Amounts: $7,500–$100,000
- Minimum Recommended Credit Score: 500
Pros
- Customer support states that 160,000 is the maximum mileage that can be allowed.
- provides loans for lease buyouts.
- Refinancing is an option if your loan balance is too high.
- Able to refinance your loan via OpenRoad once more
Cons
- possibly exorbitant fees and charges
- prohibits co-signers
- several limitations on vehicles
Why We Selected
The website for OpenRoad Lending appears to have been created in a bygone era. However, since OpenRoad Lending’s 160,000 mile limit is the highest disclosed limit among the lenders we reviewed, it can be useful if you’re having trouble making your auto loan payments and you’re not able to qualify for a better loan with another lender. This is especially true if you need to refinance a loan for a car with a high mileage.
It has extremely high origination costs (between $249 and $449), a 5% late payment fee, and interest rates that push less-qualified customers into credit card debt.
OpenRoad Lending is still superior to a lot of other alternative auto loan options, like those from lenders that let you buy here and pay here. If you have a low credit score and are underwater on your present loan—a common issue for borrowers with bad credit auto loans—you may still be eligible.
With a maximum loan-to-value ratio of 180% offered by OpenRoad Lending, you may be able to borrow significantly more than most other lenders—nearly twice the real value of your car—to pay off your current loan.
Established in 2009, OpenRoad Lending is situated in Fort Worth, Texas.
To contact OpenRoad for assistance, you can reach them by phone or email. View our detailed review of OpenRoad Lending auto loans to learn more.
Terms and Borrower Qualifications
- Refinance loan terms: 24–72 months
- Minimum credit score of 500
- Must be at least 18 years old
- Available to residents in 46 U.S. states
- The minimum monthly income required is $2,000 (profits from Uber or comparable services do not go against the income criteria).
- Your DTI can’t be more than 40%.
- can only refinance auto loans from banks and credit unions that are FDIC or NCUA insured.
Vehicle Qualifications
- Maximum accepted vehicle age: Not disclosed
- Maximum accepted mileage: 160,000 miles
- Maximum loan-to-value ratio: 175%
- Allows private-party vehicle purchases: No
- Business vehicles, Oldsmobile, Daewoo, Smart Car, and Isuzu vehicles are not eligible for refinancing
How to Get the Lowest Interest Rates On Your Auto Loan
1. A variety of lenders, including banks, credit unions, and internet lenders, offer auto loans. Dealerships collaborate with these lenders to provide you with financing options.
2. It is advisable to shop around for a loan before you really begin your automobile search, as this will provide you more negotiating power when you do find the vehicle of your dreams and allow you to take your time in determining the best loan alternatives.
3. Before approving your loan, each lender will review your credit history and the vehicle you wish to purchase.
4. Obtaining preapproval from a number of lenders might help you get started with the loan shopping process. In certain instances, this can necessitate a rigorous credit inquiry. It’s likely that certain lenders will provide cheaper rates than others.
5. You will be informed by the lender of the rates and terms you are likely to be eligible for if you are pre-approved based on the first information you supply, which includes personal information like your Social Security number and certain financial statistics.
6. Lenders have a few requirements. If you have the time and are able to, it is a good idea to take care of your credit in advance. The three most significant factors are your income, your credit score, and your debt payments. Think about strategies to lower your debt-to-income ratio.
Final Verdict
Try PenFed first if you’re searching for the greatest overall vehicle loans; it’s a credit union that anyone may join for just $5 after being authorized for a loan. It’s also a good idea to look into AUTOPAY, particularly if you want to look at several lenders. Another excellent option for a rate-comparison website is LendingTree. If you would rather stay with credit unions, Consumers Credit Union is an additional excellent choice that accepts applications from anyone.
Alternatively, Carvana has some distinctive and reasonably priced financing choices if you’re not very choosy about your vehicle and would rather have a simpler experience. Lastly, if you’re trying to avoid a high-rate auto loan, OpenRoad Lending has a lot of potential even though it’s pricey.
FAQ
Auto loans are installment loans used to acquire or refinance a car. Secured auto loans use the car as collateral. The lender can confiscate the car if you miss monthly payments. People can buy cars with personal loans, but secured auto loans have cheaper rates since lenders have more security if you don’t pay.
To cover taxes, fees, dealer improvements, and other costs, auto loan lenders may let you borrow more than the car’s price. Auto loans, like installment loans, provide a lump sum. Equal monthly installments are made until the term loan is paid off. Since interest is charged, the borrower pays back more than they borrowed.
Traditional banks, online banks, credit unions, and lending marketplaces offer auto loans. All of those sources offer new, used, and refinance vehicle loans, but some only offer particular loan types and offer first-time car buyer offers.
Dealerships that work with banks may provide reduced auto loan rates, but it’s worth being pre-approved with lenders to compare rates. You can then negotiate with the dealership to beat your best rate.
Learn how auto loans operate from our experts.